Why the Esports Mogul (ASX:ESH) share price is down today

The Esports Mogul (ASX: ESH) share price has crashed 7.69% lower today as the company announced its quarterly report. We take a closer look.

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Shares in gaming company Esports Mogul Ltd (ASX: ESH) are dropping today as the company announced its quarterly report.

The Esports Mogul share price has fallen 7.69% on the back of the news. In morning trade, its price dropped as low as 2.2 cents although it currently sits at 2.4 cents.

What did the report reveal?

The quarterly report has been highly anticipated, with the Esports Mogul share price jumping up as high as 3 cents within just the last 5 days. However, with a higher share price comes higher expectations.

During the quarter, the e-sport gaming company announced an oversubscribed placement which successfully raised $8 million. The placement will focus on funding the company’s expansion into mobile gaming. Strategically, with no native mobile tournament solution currently in the market globally, Esports Mogul believes it possesses a first mover advantage.

Furthermore, the company also announced a deal to partner with NASDAQ-listed Super League Gaming. The partnership gives Esports Mogul the opportunity to incorporate Super League Gaming’s AI technology into its platform.

Despite the positive announcements, the company’s cash flow report failed to impress, raking in just $66,000 from customers. In total, the company lost $523,000 in the quarter. As a result, Esports Mogul has $1.68 million in the bank, but this does not take into account its recent placement.

New appointments

Esports Mogul announced two newcomers to the leadership team, with Kate Vale and Michael Rubinelli joining the company.

Mr Rubinelli, a former Electronic Arts and Walt Disney Co executive, has been appointed CEO. He brings significant experience in executive leadership, product development and revenue growth. Ms Vale, who has experience with Alphabet Inc and Spotify Technology, joins the Esports Mogul board. 

What now for the Esports Mogul share price?

Despite recent share price gains, the company’s market cap remains around the $60 million mark. 

The company finished developing its tournament-as-a-service offering for global brands, advertisers and agencies during the quarter, which may bode well for the Esports Mogul share price moving forward.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Daniel Ewing owns shares of Alphabet (A shares) and Walt Disney. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares) and Walt Disney. The Motley Fool Australia's parent company Motley Fool Holdings Inc. recommends Electronic Arts and recommends the following options: long January 2021 $60 calls on Walt Disney. The Motley Fool Australia has recommended Alphabet (A shares) and Walt Disney. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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